North Sea oil revenue falls by 55 per cent between 2013-14 and 2014-15
North Sea oil revenue fell by 55 per cent between 2013-14 and 2014-15, according to new Government Expenditure and Revenue Scotland (GERS) figures.
The figures show Scotland recorded a net fiscal deficit of £14.9bn when a geographic share of North Sea revenues is taken into account, the equivalent of 9.7 per cent of GDP in 2014-15. The Scottish deficit was nearly double that of the rest of the UK.
Nicola Sturgeon said the figures show the foundations of Scotland’s economy are strong.
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She said: “Taken in the context of the wider economic environment, which has been impacted by muted global demand, falling oil prices and more difficult conditions for manufacturers, the economy has remained resilient with record levels of employment, positive economic growth and growing exports.
She added: “These GERS figures show our strategic priority of investing in economic growth – with spending per head on economic development in Scotland more than twice the UK average.
“However – despite the fact the onshore economy accounts for more than 90 per cent of Scotland’s output – Scotland is clearly not immune to the problems being felt by the oil industry internationally.”
But Labour, the Lib Dems and the Tories all warned the fall in oil revenues damaged the SNP case for independence.
Scottish Conservative finance spokesman Murdo Fraser said the figures “shed new light on the SNP's deception before the referendum”, while Willie Rennie said the figures showed Sturgeon's economic credibility has been “smashed to smithereens”.
Labour leader Kezia Dugdale said the GERS figures “show once and for all the devastating impact leaving the UK would have had on Scotland's finances”.
She said: “The fact that the cuts that would have been needed after separation would have been five times more than those being imposed now by George Osborne gives a sense of the impact on our schools and hospitals. People were misled by the SNP in the run-up to the referendum and that is unforgivable.
"Voting to stay in the UK and the recent fiscal framework deal means that the Barnett formula is protected. The new consensus in Scottish politics around the principle of no detriment and the value of pooling and sharing resources must extend to all constitutional choices.”
Finance secretary John Swinney said the collapse in oil revenues were proof that “a substantial reduction in the headline rate of tax” was required to make the North Sea more internationally competitive.
He also called on George Osborne to remove fiscal barriers for exploration and enhanced oil recovery and urgently consider additional non-fiscal support – such as government loan guarantees – to support the sector.
Patrick Harvie said: “These figures prove that Scotland is in urgent need of a bold transition plan that will secure high-quality jobs and energy production in the face of North Sea oil industry decline.
“Estimates by the Scottish Greens show that Scotland can create 204,000 jobs in industries such as renewable energy, decommissioning, energy efficiency. But with the Tory attack on the renewable sector and the SNP's painfully slow response to the growing demand for decommissioning, it's clear that our governments are lacking the vision and political will to start properly planning ahead properly.”